The Central Bank of Egypt (CBE) has approved a new regulatory framework that allows banks to hire third-party agents to provide selected services outside their branch networks. This initiative aims to reduce branch expansion costs and enhance financial inclusion for excluded groups and MSMEs.
Under this framework, contracted agents can perform specific tasks such as customer identification, e-KYC verification, and delivering unactivated bank cards. However, they are prohibited from using the term “bank” in their branding. Banks can engage CBE-licensed institutions, non-bank financial institutions, and other entities that meet the bank’s due diligence requirements.
New Framework for Third-Party Agents in Egypt
The CBE’s decision is part of a broader strategy to boost financial inclusion among adults in Egypt, targeting an increase to 80% by FY 2029/30 from the current rate of 76.3%. As of June, the financial inclusion rate stood at 79%. This regulatory change is expected to facilitate access to banking services for underserved populations.
By allowing third-party agents to handle specific banking tasks, the CBE aims to streamline operations and reduce costs associated with traditional banking methods. This move is particularly significant for micro, small, and medium enterprises (MSMEs) that often struggle to access financial services.
Investment in Data Centers and Manufacturing
In related developments, MTS Integrated Solutions is negotiating with the government to establish a USD 100 million data center manufacturing plant for China’s Inspur in Ain Sokhna. This facility will focus on producing hardware for state-owned data centers, ensuring that national data remains domestic.
Additionally, Jiangsu General Science Technology plans to invest up to USD 295 million in a tire manufacturing plant in Sokhna Industrial Zone. This plant aims to produce 6 million semi-steel passenger car tires and 800,000 all-steel truck and bus tires annually, with completion expected within 36 months.
Next Steps for Industrial Investment
- The Industry Ministry is assessing 51 distressed factories for potential restructuring.
- Investors acquiring distressed factories can access working capital financing at reduced rates.
- The government has launched the EGP 1 billion Distressed Factories Restructuring Fund to support viable industrial firms.
The CBE’s new framework aims to enhance financial inclusion and streamline banking services in Egypt.
